Start-Up Market Research

AS Business Studies

Aims and Objectives

Aim:• Understand primary and secondary research

methods.Objectives:• Define primary & secondary research• Explain different methods of research• Analyse primary and secondary research• Evaluate primary and secondary research

Starter

• What is meant by the term ‘market research’?

• Why may it be important for a new business to conduct start-up market research?

Importance of Start-Up Market Research

It is important to understand the wants and needs of the market before starting your business, and whilst you are operating a business.

No point in starting a business if there is no market demand for your product/service.

Primary Market Research

Data collected by the entrepreneur, or paid to be

collected which does not already exist.

Secondary Market Research

Data already in existence that has not been collected

specifically for the purposes of the entrepreneur.

Primary or Secondary Market Research?

Research Method Primary Secondary

Questionnaires: a set of questions designed to discover information relating to a product or service.

Interviews: interviews with members of the public to find out their views.

Focus Groups: in-depth discussion with a small group of consumers, which probes their feelings towards a product or service.

Telephone Survey: a series of set questions delivered over the telephone to consumers as a method of primary research.

Internet Research: Researching markets on the internet.

Supplier Feedback: gathering information from businesses which supply products and services.

Customer Feedback: formal or informal responses from customers to the product or service offered by customers.

Primary Research Methods

Questionnaires

Focus groups

Telephone surveysTest marketing

Interviews

Secondary Research Methods

Government Reports

Market Data Reports

Yellow Pages

Mintel Reports

Spot the odd one out – why?

Primary Research – Sampling Methods

• When conducting primary research like questionnaires the entrepreneur cannot ask their entire target market.

Random Sampling:• One in which each potential member of a group

has an equal chance of being in the sample

Primary Research – Sampling Methods

Quota Sampling:• This is not random, as not everyone has an equal

chance of being in it, and the results cannot be used to predict the behaviour of everyone.

Stratified Sample:• Popular with researchers as it has the benefits of

being random, thus reducing bias, and is not as expensive or as difficult as full random sample.

Primary Research – Sampling Methods

Think, Pair, Share how each of the following may affect an entrepreneurs choice of sampling methods:• Available finance• Nature of the product• Level of risk• Target market

Primary Research – Sampling Methods

Available Finance

• Due to start-up nature of business market research needs to be lost cost or free.

Nature of Product

• Many entrepreneurs find it easier to research a physical product rather than a service.

Level of Risk

• The newer the product the greater the risk – and the potential rewards!

Target Market

• A clearly identified target market is easier to target in terms of sample.

Innocent Smoothies

A good method of market research or not?• Should we quit our jobs and make Smoothies?

Yes No

AN. EV: Primary Research & Secondary Research

Read Primary market research vs. Secondary market research: a comparative analysis.

Analyse the advantages and disadvantages of both primary and secondary research in two tables.

Evaluate: which method is best according to the analysis? What may an entrepreneurs decision depend on?

AN. EV: Primary Research & Secondary Research - Plenary

Read Primary market research vs. Secondary market research: a comparative analysis.

Analyse the advantages and disadvantages of both primary and secondary research in two tables.

Evaluate: which method is best according to the analysis? What may an entrepreneurs decision depend on?